Euroland puts its faith in repos

Cedel and Euroclear reckon half the volume they clear annually is repo business - $25 trillion. That includes government and corporate bonds. Add in the growing repo business in equities and there's a huge market - in collateralization, short-trading and securities lending. Katharine Morton reports.

Repurchase agreements (repos) will be the backbone of the new order after European economic and monetary union (Emu). The implications for the debt repo and securities lending markets in Europe are profound. There will be less impact on the nascent equity repo and securities lending markets, those are driven by the search for higher returns.

John Langton, chief executive of the International Securities Market Association (Isma) is bullish about the future of the debt repo market in Europe.

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